Clients who get married are starting a life together that could benefit from a financial planner.
But financial advisors seeking to retain them for the long term must engage both spouses in helping them through the many emotional issues connected to shared money and wealth — let alone the technical planning strategies, according to panels at this week's
The couple may not even stay together if they can't work toward shared financial goals for the future. And advisors may lose them as clients,
Planners and other experts at the conference delved into the behavioral finance aspect of marriage in one specific panel, but the topic came up in at least two other discussions as well.
Money "is inherently left-brained," which equates with being "a logical thing, meaning two plus two always equals four, right?" said Jeremy Gilliam, a licensed marriage therapist who works with the clients of wealth management firms as the founder of
"It's not always as simple as, 'If you do this and this and this.' Depending on their life experiences and their background, it could be a whole different scenario and different story for them, depending on how they approach and how they feel about money," he said.
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First, start the healthy conversation
A lot of
Regardless of the couples' decision about that, their planners must help them find a unifying understanding of their wealth and create an environment in which they can talk through the toughest topics openly, according to Cherry, a former president of the
"That takes courage, trust and vulnerability. I know people toss those words around these days like they're Skittles," he said. "We need to agree that this is a challenge for our household or this is something that we want to accomplish."
Unfortunately, many couples never reach that point. Kovar has owned his RIA for roughly a decade, but he first reached out to Gilliam a handful of years ago after a difficult client meeting, he said. Later, Kovar and his wife Megan launched a marriage and money education firm called
"I had a couple in my office, and they were talking about money, and we're digging into their finances, and they are just going at it," Kovar said. "I was like, 'Hey man, you've got to help me out here. You're a marriage family therapist. Help me help these people,' because what we found out is a lot of couples just don't talk about money, or, if they do, it's fighting."
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Reading the signals
More planners have been embracing the behavioral side of money and wealth in recent years, including trying to bulk up their financial therapy training or
That could come in the form of a divorce that completely alters their wealth or, in some cases, financial abuse that brings red flags about
For instance, a surviving spouse may discover how their partner's death "can really crank their tax bracket," said Megan Brinsfield, president of
"That means that Roth is going to have to be emptied in five years, versus, if someone is leaving their Roth to a spouse, that spouse can take it over their lifetime," she said. "That can create materially different wealth outcomes, tax outcomes and emotional outcomes as well. So you have a large role to play, not just in the upfront decision, but with some of the particulars downstream as well, related to couples. I think there's a big part of the discussion that really can be somewhat sensitive. For clients that are aging, I do find the clients become a lot more, sort of, macabre as they get older and open to talking about their own deaths."
Luckily, those days are much further away for many newlyweds. Planners can aid couples trying to resolve thorny issues such as the degree of support for the extended family of one of the spouses, said Gloria Garcia Cisneros, a wealth manager with the Los Angeles office of advisory practice
"Sometimes it can be give and take," Garcia Cisneros said. "Sometimes they just haven't even had space to talk about it."
The links between money and marriage reflect how much planning has
"When you have a conversation with them, you can tell they've been fighting about it," Harrison said. "This is not like, one person is a good person and one person is not a good person. It's just different lived experiences."
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Shifting the dialogue
Kovar and Cherry shared processes that couples can use to drive a better dynamic of planning as a couple for the long term. Cherry's advice for fellow advisors educating clients about marriage and money revolved around questions like, "how did you approach having that dialogue to hear both the perspectives about the adult child?" The issue of financial support for an adult child may clash with other goals, such as taking two big vacations a year or retiring at 55 years old, he noted. Advisors need to focus on speaking with both spouses to drive home that they're a financial team and ensure that no one feels left out of the discussion, he said.
"The challenge is there. If you don't address it, you're going to lose a client, because part of the process is to set an expectation with the outcomes that you're trying to collaborate with a client," Cherry said. "That's perspectives from spouse one, spouse two. They disagreed on how much they should be spending on the adult child. So, if the expectation is they want to retire at 55 but yet they can't find the money to max fund at 50, well, there's the money right there."
The Kovars' marriage and money education firm offers a quiz called "
"It can feel like you're controlling me," he said. "I met a client recently who's like, 'I'm a grown man. I should go spend the money however I want to. Why do I get an allowance? I'm the one that is making the money.' It's like, yeah, but, I mean, you like being married, right?"